BP plc (ADR) (NYSE:BP) has been raising additional petroleum cargoes in recent months as payment for its work in Iraq, revealed a senior executive of the company.
As part of the renewed deal with Iraq’s Oil Ministry, BP works on plugging in declining production at the Kirkuk oilfield. Kirkuk’s third formation, Khurmala’s operations are managed under the supervision of the Kurdistan regional government. Currently, Kirkuk is a disputed territory between Iraq’s Kurdish region and the central government in Baghdad.
BP’s Middle East President says that existing total production from Iraq’s Rumaila field is 1.4 million barrels a day. The company expects the oil production to remain stable in 2015. Rumaila, the world’s second largest oil company in Iraq, currently, produces in excess of 40% of Iraq’s oil. The largest oilfield in Iraq, Rumaila commands a share of over 50% of Iraq’s budget revenues.
Briefing reports in Abu Dhabi, Michael Townshen, BP’s Middle East President, revealed that the payments have gone up, and the oil company is comfortably placed now. He acknowledged that the oil firm’s liftings certainly received a major boost in the last couple of months. However, he stopped short of elaborating on the details of the liftings. The company is enjoying a purple patch with the liftings coming either from Ceyhan or out of the south.
During the period of 2003-2006, BP undertook a technical feasibility study on the development of the Rumaila field. After being awarded the Technical Service Contract, BP plc (ADR) (NYSE:BP) is working in tandem with SOS, PetroChina to build the second largest oil field in the world. Overseas firms pump in investments into the fields, and they receive fees barrel-wise.
Reduced oil prices and battle against Islamic nations have compelled Iraq into delay billions of dollar cash payments what it owes to global oil corporations. As an alternative, Iraq oil companies are allowed to take oil shipments.
The British oil major was the first global oil company to have come back into Iraq oil market after three-and-half decade. With a majority of the global giant oilfields decelerating, the future of oil production in Rumaila and Kirkuk is in jeopardy now.
